UK-based components and systems manufacturer Senior has agreed to sell its aerostructures business to UK-based mid-market private equity investor Sullivan Street Partners for £200 million.
Following the transaction's closing, Senior will be a fluid conveyance and thermal management business.
“The Aerostructures business is well positioned to prosper and grow and we wish our colleagues there every success in the future,” said Senior CEO David Squires. “Our remaining high quality fluid conveyance and thermal management business is well positioned to deliver attractive growth, improved margins, and better returns on capital with strong operating cash flow performance.”
The company said the sale will simplify the company's operations, allowing it to focus on its “high quality, differentiated products”, as well as positioning it to operate in “attractive and structurally resilient end markets”.
In addition, Senior said the sale of the business will improve its financial position and performance.
Following completion of the sale, the group's medium-term financial targets include operating margins at least double-digit margins.
Net proceeds are expected to be around £100 million and will be used to reduce net debt and fund its £40 million share buyback programme, which was disclosed in tandem with the transaction. The buyback programme is expected to commence when the deal closes.
Including its aerostructures segment, Senior's aerospace revenues were £977.1 million and adjusted operating profit was £46.5 million in full year 2024.
The divestment includes £150 million subject to completion, while £50 million is due in the first half of next year. The latter is dependent on the aerostructures business' full year 2025 EBITDA performance.
The aerostructures segment has five operating businesses across seven sites and represented around 28% of the group's revenues in 2024.